Grinstein-DAL has no plans to merge

[FDJ2]

November 2, 2006

Jerry Grinstein says that despite the talk, mergers or acquisitions are not a part of our plans to emerge from bankruptcy next year. That's one of the reasons we've moved ahead with our aggressive cost-cutting and product improvements.
“Delta has no plans for discussions with any airline – or with any party representing any airline – about a potential merger or acquisition,” Jerry said in his most recent employee update. “Our intent remains for Delta to exit bankruptcy as an independent, stand-alone company, not as a merged, acquired or otherwise consolidated airline.”

 

[Tomct]

Hope that they can find some other aircraft, because they need to continue to grow or they are dying!

 

[FDJ2]

Hope that they can find some other aircraft, because they need to continue to grow or they are dying!

At least 13 757s in '07, 3 777s in '08 plus standing orders for 737-800s in '08, and '09. I expect a significant order for additional jets to be forthcoming.

I don't think DAL needs double digit growth to survive, modest growth might surfice, DAL just needs to keep doing what it has been doing recently, improving revenue performance. There will be some set backs on the road to recovery, the September numbers might be a little weak, like most Septembers a suspect, but for now the airline is ahead of plan.

 

[General Lee]

Expect a large order for new aircraft after we exit from BK. We also still have orders on the books, and along with the 13 757s we will be getting from AA in 07, there are plenty of 777s and 738s still coming. FDJ2 is correct.

Bye Bye--General Lee

 

[michael707767]

Expect a large order for new aircraft after we exit from BK.

I am going to agree and disagree here. I think once Delta exits BK we will see a large order for 787s. But, these will largely be replacement aircraft for the 767-300ERs.

I think beyond that, I think Delta will wait before placing a large order for any narrowbodies until Boeing has decided on the 737 follow on. Small numbers of 737-800s and -700s before then, but nothing big. Maybe a small order for 100 seaters, but again, I think Delta will wait to see what Boeing does. The new narrowbody from Boeing may well have an economical airplane going from 100 up to about 170 seats.

 

[Launchpad]

Getting 13 from AMR, and selling 13 of the current 757's to Fedex. I'm anxiously waiting for the "Unprecedented Growth"

I'm not getting excited about new deliveries either, remember those are all deferrals from 05-07'. I'm waiting to get the news about how they sold those aircraft positions to airline XYZ. It's happened twice in the last 5 years.

Peace out yo-

 

[michael707767]

Getting 13 from AMR, and selling 13 of the current 757's to Fedex. I'm anxiously waiting for the "Unprecedented Growth"

I must have missed the announcement of selling 13 757s to Fedex.

 

[Launchpad]

Well, they are talking about it all over the dalpa board. Not sure if it's rumor, speculation or fact. It just kinda sounds like it's going to be a wash- I haven't been following it that close.

 

[michael707767]

Well, they are talking about it all over the dalpa board. Not sure if it's rumor, speculation or fact. It just kinda sounds like it's going to be a wash- I haven't been following it that close.

We are going to get rid of some of the older 757s starting in 08. I don't think they will go away quickly though, and the fleet plan has net growth of about 45 airplanes between now and 2010. Not huge growth, which we really don't need, but it is growth. And barring anything unforeseen, I think the fleet plan at this point is conservative.

 

[blzr]

U.S. Air also strongly denied ANY rumors and intent to merge with America West. I doubt the will anyway, but would you really think the CEO would come out and publically talk about a merger before it happened?

 

[FDJ2]

but would you really think the CEO would come out and publically talk about a merger before it happened?

Yes. USA/AWA and UAL are both talking up consolidation. DAL is not.

I agree with Michael, we will see a net increase in aircraft of approximately 45 airframes in the next few years. Modest growth, but growth nonetheless.

 

[tomgoodman]

Plans can "change"

...would you really think the CEO would come out and publically talk about a merger before it happened?

Probably not....too much risk of boosting the stock price, making a merger more expensive. Then, if the merger talks are failing, they can't quickly cash in their appreciated stock without looking like inside traders.

 

[General Lee]

Getting 13 from AMR, and selling 13 of the current 757's to Fedex. I'm anxiously waiting for the "Unprecedented Growth"

I'm not getting excited about new deliveries either, remember those are all deferrals from 05-07'. I'm waiting to get the news about how they sold those aircraft positions to airline XYZ. It's happened twice in the last 5 years.

Peace out yo-

Yeah, where again was it stated we WOULD be selling 13 757s to Fedex? I missed it too. It could happen, but I haven't heard it yet.

Bye Bye--General Lee

 

[General Lee]

Probably not....too much risk of boosting the stock price, making a merger more expensive. Then, if the merger talks are failing, they can't quickly cash in their appreciated stock without looking like inside traders.

I can see a CEO trying to remain quiet about a possible merger, but not one continually coming out and stating "No mergers." That is the difference. Sure, it could happen, but Grinstein is being way too proactive in actually making statements.

Bye Bye--General Lee

 

[Tomct]

I am going to agree and disagree here. I think once Delta exits BK we will see a large order for 787s. But, these will largely be replacement aircraft for the 767-300ERs.

I think beyond that, I think Delta will wait before placing a large order for any narrowbodies until Boeing has decided on the 737 follow on. Small numbers of 737-800s and -700s before then, but nothing big. Maybe a small order for 100 seaters, but again, I think Delta will wait to see what Boeing does. The new narrowbody from Boeing may well have an economical airplane going from 100 up to about 170 seats.

But Mike, there are NO VACANCIES in the 787 order books until 2012. I think that it would be great to get them, but it may be waaaaay down the road!

 

[800Dog]

But Mike, there are NO VACANCIES in the 787 order books until 2012. I think that it would be great to get them, but it may be waaaaay down the road!

And what about orders from leasing companies?

 

[m80drvr]

So let me get this straight. US airlines just finally reduced capacity enough to finally make money and you folks think Delta or any major will show double digit growth in the near future (sans SWA). There will be orders but most likely they would be replacements for the 80's and older 767's.

Management at all airlines have short memories and try to reinvent the wheel every decade or so but I would hope that they would remember, at least for the sort term, that over capacity got them to the huge losses for the last few years.

Just an opinion from a stupid pilot though.

 

[General Lee]

But Mike, there are NO VACANCIES in the 787 order books until 2012. I think that it would be great to get them, but it may be waaaaay down the road!

Supposedly we have them through a lessor like ILFC or GECAS. We got the first 10 AA 757ERs through ILFC, and the other 3 from another. We have relationships with lessors, and not all of them hate us.

Bye Bye--General Lee

 

[Pat Fabin]

"growth" aircraft

MD80,

You bring up good points with regards to capacity. I believe that most of these airplanes will be "fleet growth", not necessarily capacity growth. We'll have new international-capable aircraft to increase that flying, but we lost 80+ airframes last year.

A good 50 of them (the 737-200s) flew for most of the year until the end of the summer. I think most of the new airplanes will grow the current fleet, but just back to where we started last year. I'm sure our overall domestic capacity will not grow when measured against 2005, except where necessary to support the internatioal growth.

In any case, it should mean more jobs for our current and future pilots, but I don't see them flooding the domestic market with seats. The LCCs are doing that to themselves already.

 

[Medeco]

Grinstein will say whatevery he needs to say.

Just one quote I found of him saying no bankruptcy. If I were bored even more I think I could find even more.

I think a merger will become common talk after they exit BK.

“The proposed pilot savings, as difficult and painful as they are, will make a meaningful contribution to a massive company-wide effort underway to help transform Delta into a formidable and viable competitor. I am extremely grateful to all of Delta’s employees who are making enormous sacrifices to help our company restructure on its own terms and avoid bankruptcy,” Grinstein said.

Medeco

 

[tomgoodman]

No merger...YET!

I think a merger will become common talk after they exit BK.

Right. But until that time, Grinstein wants to dampen expectations of a profitable merger, lest creditors get hard-nosed about accepting the exit deal. In addition, there are still some employee givebacks to be locked in and new executive stock options to be arranged. For best results, pesky profits and stock price jumps must not occur too soon. After BK exit, Grinstein can say "There WERE no merger plans THEN, but this is NOW."

 

[General Lee]

Pure speculation Tom. I think Grinstein is being a bit too proactive in his public stance. He is going out of his way, in the public forum, to say no mergers. He could just go the quiet route and still answer questions if asked. But, he is coming out and saying no mergers. That puts his reputation at risk, and he wants to have a "'legacy" it seems as the "savior of Delta."


Bye Bye--General Lee

 

[scopeCMRandASA]

Back to the orders...there will be an announcement of 40+ or - more narrowbodies prior to exiting BK, and a 787 order after BK exit.

 

[michael707767]

But Mike, there are NO VACANCIES in the 787 order books until 2012. I think that it would be great to get them, but it may be waaaaay down the road!

I didn't say when we would get any 787s, I just said I think we will order them. Given that I believe the 787s will mostly be replacements for the 767ERs, I think it makes sense that we would not get any until about 2012.

 

[PowerRanger]

But Mike, there are NO VACANCIES in the 787 order books until 2012. I think that it would be great to get them, but it may be waaaaay down the road!

Actually I have read due to the immence popularity of the 787,Boeing is strongly considering opening up a second production line.

So that is where *if* possible new orders & delivery dates prior to 2012 could come from.

 

[FDJ2]

Just one quote I found of him saying no bankruptcy. If I were bored even more I think I could find even more.

I think a merger will become common talk after they exit BK.

“The proposed pilot savings, as difficult and painful as they are, will make a meaningful contribution to a massive company-wide effort underway to help transform Delta into a formidable and viable competitor. I am extremely grateful to all of Delta’s employees who are making enormous sacrifices to help our company restructure on its own terms and avoid bankruptcy,” Grinstein said.

Medeco

Medeco GG has always said that he would try to avoid BK, he never said we wouldn't go into BK. Big difference. GG's above quote I assume is from 2004 where all the employees took paycuts in order to help the company restructure on its own terms, just like an EMT might try to help someone having a heart attack, there was never a guarantee that the "help" would save the corporation or the patient.

 

[PowerRanger]

Medeco GG has always said that he would try to avoid BK, he never said we wouldn't go into BK. Big difference. GG's above quote I assume is from 2004 where all the employees took paycuts in order to help the company restructure on its own terms, just like an EMT might try to help someone having a heart attack, there was never a guarantee that the "help" would save the corporation or the patient.

Puh-lease...I take it from your post on the board that you're a Delta pilot. I'm just a lonely PPL but even I know that Delta wasn't in any kinda financial trouble that warranted filing bankruptcy.

Bankruptcy profiteering was the name of that game. They saw what other carriers were geting in BK and they wanted their share. From huge bonus for managment to getting lower lease rates on equpiment and employees taking huge concessions. It was all financial greed.

They wanted $300 some odd million dollars from the pilots or threathened liquidation...again puh-lease. DL wouldn't liquidate for a mere $300 some odd million.

 

[FDJ2]

Puh-lease...I take it from your post on the board that you're a Delta pilot. I'm just a lonely PPL but even I know that Delta wasn't in any kinda financial trouble that warranted filing bankruptcy.

You are right, DAL was awash in profits, the billions in losses were all a smoke screen. Thanks for setting me straight on the facts.

 

[PowerRanger]

You are right, DAL was awash in profits, the billions in losses were all a smoke screen. Thanks for setting me straight on the facts.

Cooking the books is what that is called.

Kinda like how Mesaba was bankrupt when they had long been posting profit. But in truth all the money from Mesaba was just transferred to MAIR to make it look like Mesaba was broke. Or Mesaba saying that they were going to liquidate by Oct. 15th if the pilots didn't take a 19% pay cut and here it is Nov. 3rd an no liquidation. Or magically their now only asking for 5% now instead of 19%.

Or if you want something closer to home Comair. Long praised by Delta as a huge money maker then almost overnight...strapped for cash and asking for concessions. My point is anything could be made to look like something in order to better justify ones goal.

Not saying that DL wasn't having a hard time with oil at $70 a barrel I'm sure profits were slim but they were never in dire trouble...no never!

 

[General Lee]

Cooking the books is what that is called.

Kinda like how Mesaba was bankrupt when they had long been posting profit. But in truth all the money from Mesaba was just transferred to MAIR to make it look like Mesaba was broke. Or Mesaba saying that they were going to liquidate by Oct. 15th if the pilots didn't take a 19% pay cut and here it is Nov. 3rd an no liquidation. Or magically their now only asking for 5% now instead of 19%.

Or if you want something closer to home Comair. Long praised by Delta as a huge money maker then almost overnight...strapped for cash and asking for concessions. My point is anything could be made to look like something in order to better justify ones goal.

Not saying that DL wasn't having a hard time with oil at $70 a barrel I'm sure profits were slim but they were never in dire trouble...no never!

Ever heard of Sarbanes Oxley legislation? They are rules governing how the CEO's and CFO's conduct business. There are thousands of papers each company has to file with the government, and if they get something wrong, both of them can go to jail. But hey, they just trashed everyone's stock and our credit rating (and stiffing the PBGC) just to get the pilots to come down on their pay. Riiiiiiight.


Bye Bye--General Lee